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Investor group makes $300 mn buyout offer to American Apparel

American Apparel has got a $300-million buyout offer from an investor group interestingly backed by the company’s former chief executive Dov Charney, who was ousted after a series of sexual harassment cases against him.

Private equity firms Hagan Capital Group and Silver Creek Capital Partners in a joint statement said that their offer of $300 million for the troubled retailer included $90 million of new equity and a $40 million term loan. The enterprise value of the deal is above the valuation of $180 million-$270 million. If the deal gets through, the company would be able to address the bankruptcy pressure and will also see Charney rejoining as the CEO of American Apparel.

The company operated 218 stores in 19 countries and became popular for its advertisement campaigns depicting over-the-top sexual imagery. Meanwhile, a hearing on the bankruptcy application will be conducted on January 20, 2016 to confirm the bankruptcy plan. Under the bankruptcy plan, American Apparel said it has secured $40 million in additional capital, in addition to the $40 million of new capital previously committed by lenders.